UPDATE 1-Bank of Canada deputy governor Leduc to leave after just two years

Reuters Staff

2 Min Read

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By Fergal Smith

OTTAWA, June 13 (Reuters) - Bank of Canada deputy governor Sylvain Leduc will leave the central bank in late July 2018, in a surprise departure for the market that is nevertheless not expected to impact monetary policy.

After spending a little over two years at the Bank of Canada, Leduc will resume working at the Federal Reserve Bank of San Francisco, the central bank said on Wednesday.

“It’s a bit surprising because he has only been there for about two years,” said Robert Both, a macro strategist at TD Securities. “We don’t expect to see any impact on policy because of this.”

Leduc, one of the four deputy governors, is part of the central bank’s Governing Council, which makes the final decision, by consensus, on interest rates.

Less than two weeks ago, Leduc painted a relatively positive picture of the Canadian economy, saying the tenor of recent data has improved and wage growth was getting closer to what would be expected for an economy operating at potential.

The central bank last raised its policy rate in January to 1.25 percent and money markets see a greater-than 60 percent chance of another tightening at the next interest rate announcement on July 11.

The bank said it would immediately start the process of finding a replacement for Leduc, who was appointed in May 2016. He worked as one of two deputy governors “responsible for overseeing the bank’s analysis and activities in promoting a stable and efficient financial system”, it added. (Additional reporting by David Ljunggren Editing by Chizu Nomiyama and Marguerita Choy)